KKR & Co. Missed Its 3Q17 Earnings Numbers
EPS estimates missed
KKR & Co. (KKR), an alternative asset manager, reported its 3Q17 earnings on October 26, 2017. The company posted earnings per share (or EPS) of $0.36, which fell short of Wall Street analysts’ estimate of $0.42.
KKR & Co. reported a profit margin of ~23.0%. Alternative asset managers (XLF) Carlyle Group (CG), Blackstone Group (BX), and Apollo Global Management (APO) reported profit margins of ~4.1%, ~23.5%, and ~22.5%, respectively.
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KKR & Co. reported total segment revenues of $769.7 million in 3Q17 compared to ~$1.0 billion in 3Q16. This YoY decline was mostly due to a decline in carried interest gains and investment income. Lower appreciation in the company’s private equity portfolio contributed to this decline.
Total management, monitoring, and transaction fees
KKR & Co. reported total management, monitoring, and transaction fees of $355.7 million in 3Q17 compared to $276.6 million in 3Q16. This YoY rise was mostly due to the rise in the company’s management and transaction fees.
In 3Q17, KKR reported management fees of $232.9 million compared to $201.5 million in 3Q16. The company reported transaction fees of $179.2 million in 3Q17 compared to $111.4 million in 3Q16.
KKR reported economic net income (or ENI) of $395.0 million in 3Q17. In 3Q16, it reported ENI of $669.3 million. This YoY decline was mostly due to the decline in its total segment revenues.